The buyout has been estimated at a total value of $40 mn (€33.2 mn). Of this amount, $10 mn (€8.3 mn) will be received as primary capital for the firm, while the remaining $30 mn (€24.9 mn) will be given to Everstone Capital.
In a recent statement, Sequoia Capital India revealed that it signed definitive agreements for the attainment of Faces Cosmetics Canada, Indivision India Partners-owned and private equity fund Everstone Capital-managed brand Faces, and all of its international subsidiaries.
Following the agreement, Sequoia is understood to possess 98% of Faces Cosmetics Canada. Sharmili Rajput, who heads up management, is expected to continue at the helm of the company, along with the current management lineup.
Rajeev Shukla, Managing Partner at Everstone Capital, will also retain a personal stake in the Canadian cosmetics and skin care products name.
A Challenger brand
Tipping Faces Cosmetics Canada as a challenger brand, Abhay Pandey, Managing Director at Sequoia Capital India hinted to the press the reasoning behind the strategic decision: "The role of digital in consumer education is creating the opportunity for newer brands to grow rapidly even in developed markets. We expect this trend in India too and hence the opportunity for challenger brands.”
“We are excited that there was an opportunity to buy high ownership which allows Sequoia to provide greater operational support to the leadership team in key areas like marketing and distribution,” Pandey stated.
Cosmetics: The viable opportunity
The Canadian cosmetics brand competes with leading names in the Indian beauty space, including Unilever's Lakme and Maybelline. Venture capital fund, Sequoia, is also an existing investor in Vini Cosmetics and owns a minority stake in the company.
Vini Cosmetics has a high-profile presence in India, with more than 900 physical store-in-stores, 2,000 trade shops, 13 exclusive brand outlets and a position on e-commerce sites. With these relationships in place, Sequoia’s latest acquisition cements its position in the Indian cosmetics retail space.
“The colour cosmetics market is the fastest growing category in personal care and we see a huge opportunity for the Faces brand,” added Pandey in a media statement.
Sharmili Rajput, CEO, Face Canada also reported in a statement that its “aim is to grow our revenue by 5X over the next five years, through strengthening our geographic coverage, deepening our distribution, expanding the portfolio, and extending our iconic brand to adjacent skin care categories".